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It has been a tough week for China-U.S. relations. Vice President Mike Pence ratcheted up the administrationrhetoric yesterday, calling the NBA &a wholly owned subsidiary of the authoritarian regime& in China while the leaguecommissioner Adam Silver continued to try to tamp down the intensity of criticism over the leaguebusiness, saying in an interview with The Wall Street Journal that &We have no choice but to engage and to attempt to have better understanding of other cultures and try to work through issues.&
The NBA was hardly the only challenge between the U.S. and China. This week saw the intensification of two threads of national security concerns continue to get airtime on Capitol Hill that could have massive ramifications for startups.
The first, and potentially most potent, thread is swirling around TikTok, the epically popular social video app that also happens to be owned and operated by China-based ByteDance. This week, senate majority leader Chuck Schumer and Senator Tom Cotton of Arkansas circulated a bipartisan letter requesting an assessment of TikToknational security risks.
ByteDance remains the worldhighest-valued unicorn (which, perhaps in the wake of WeWorkcollapse the past two weeks, is not an epithet that any startup wants to actually hold these days). It has received major funding from the likes of Sequoia Capital China, and is currently valued at $75 billion.
Sequoia is clearly preparing for the worst around these national security reviews. Last week, the firm confirmed to The American Lawyer that Donald Vieira, a partner at top law firm Skadden, would be joining the venture firm as chief legal officer. Vieira has spent the last few years working on cases surrounding CFIUS, the Committee on Foreign Investment in the United States (WTF is CFIUS?), and earlier was chief of staff of none other than the Department of Justicenational security division.
That expertise will be critical as Sequoia potentially faces a tough reception for ByteDance in the national security circuit on Capitol Hill. Earlier this year, CFIUS required video game publisher Beijing Kunlun to retroactively divest itself of its purchase of gay-dating app Grindr over concerns that the appuser data could provide Chinese intelligence and law enforcement officials with compromising material that would allow for individual blackmail.
While Grindr text messages may be far more compromising than the average TikTok viral video, the appsmall user base is dwarfed by TikTok, which has seen more than 100 million downloads in the U.S. alone. That potentially wide surveillance net is of acute concern for U.S. intelligence officials.
On top of that, of course, is the mediaheightened discussion the past few weeks that ByteDance could carefully calibrate the virality of videos on TikTok to hew toward Beijingcensorship dictates. That has led to some teens posting various memes about the Hong Kong protests to see how far they can push the platformred lines (as teens are wont to do).
Strategically, the China angle has become very useful for Facebook, which faces a viable threat in TikTokpopularity, according to my colleague Josh Constine. Mark Zuckerberg has made Chinapotential censorship within TikTok a major speaking point, which he emphasized in a major policy speech at Georgetown:
While our services, like WhatsApp, are used by protesters and activists everywhere due to strong encryption and privacy protections, on TikTok, the Chinese app growing quickly around the world, mentions of these protests are censored, even in the US.
Is that the internet we want?
Facebookstrategic messaging starts to lead us to the other national security thread happening these days in DC. There have been wide concerns over the past few months on Capitol Hill over bids for subway, rail, bus and other transit contracts from Chinese companies, like state-owned CRRC and electric bus and battery manufacturer BYD . There have been motions to ban federal transit funding for projects that use vehicles from Chinese-subsidized sources.
A new report published this morning by Radarlock, a data-driven research organization, argues that Beijing is using access to these contracts to enhance its &civil-military fusion,& by which China means learning how to manufacture and build leading global supply chains that help it in both private sector competitiveness and in military superiority. As the research leads Emily de La Bruyère and Nathan Picarsic write:
Through both data collection and technology, CRRC contributes to Beijingmilitary and military-civil fusion [&MCF&] projects: Explicitly declaring, in its company documents, a role in the military-civil fusion strategy, CRRC has set up an investment fund dedicated to MCF; operates in MCF industry zones; shares technology, resources, and data with military-and MCF-affiliates; and assigns the MCF label to high-profile projects and centers.
Like Facebook though, these results are being highlighted by industry sources, with Politico Pro noting that Securing AmericaFuture Energy and the Alliance for American Manufacturing have been pushing a previous report on BYD around DC.
And that gets back to the challenges of future economic ties between the two superpowers, notwithstanding the latest developments in the trade war negotiation (which seem as likely to conclude as Brexit is to happen).
National security policy is increasingly being used by incumbent players as a cudgel to stifle competition. Many of those national security concerns are valid — and sometimes acutely so — but we also need to be extraordinarily clear that like any market restriction, there is ultimately a consumer cost to these initiatives as well. The Chinese may go without star-studded basketball as much as Americans will go without working subway cars, and thatthe cost of a relationship that has never been built on a foundation of trust.
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Hello and welcome back toEquity, TechCrunchventure capital-focused podcast, where we unpack the numbers behind the headlines.
This week Kate and Alex held the reins as a duo (check out our chat with GreylockSarah Guo from last week here) to dig into an enormous raft of news. And don&t worry, itnot all late-stage happenings. We&re discussing early-stage news every week because thatwhat the listeners want!
Up top we dug into Kateexcellent work covering the Superhuman foundernew micro fund, or at least his attempt at raising such a fund. Our main question is how can he be a good VC and a good executive at the same time? Folks don&t tend to do both at the same time because they&re each more than full-time jobs. Having two such gigs sounds hard.
But hey, itnot just athletes and musicians who can bring outsized interest to deals. In-demand founders can have a similar effect. We&ll be keeping a close eye on the upcoming fun. Moving on.
Next, we turned to the other end of the venture landscape, looking at Founders Fundnew capital vehicles. With a combined $2.7 billion in eventual capital, FF is hoping to build a financial redoubt from which they can rain capital down on late-stage targets, wherever they may be.
Is it a bit late in the cycle to cut late-stage checks to companies that might otherwise go public? Thatthe gamble so far, as we can see it, but perhaps with WeWorkIPO dreams turned to nightmares, theredemand among a group of companies for another 12 months in the private markets. And that means more money is required.
On the theme of more money, Lime is raising some more and we were treated to new financial results from The Informationgreat work getting the figures. Our discussion asked the question of how far the companyunit economics could improve. Kate said that Lime is investing a lot now in developing better hardware so their scooters can last more than five minutes on the roads before breaking down. She thinks things will start looking up when itdeploying only new, fancy, good scooters. Alex is bearish.
Before we could turn back to the early-stage market and wrap up, we had to cover the latest from WeWork. SoftBank did, in the end, come and save the day (at least for now) for the company, meaning that WeWork lives on, though layoffs are expected sooner rather than later. Who knows what the future holds…
And finally, Vendr, a company that is profitable, raised a $2 million round. This is interesting because, again, itprofitable! And the startup willingly shared some financial data with us — a rarity. Read more about the recent Y Combinator graduate here.
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Read more: Growth is out, profitability is in
Write comment (97 Comments)NASA Mars 2020 rover will have to operate on its own in a harsh environment, hundreds of millions of miles from the nearest mechanic. But for now, itstill in development at NASAJet Propulsion Lab — and every milestone is an important one. Including supporting its own weight, fully assembled and resting on its own six wheels, which is what the rover managed this week.
This stand-up test is one of many the rover is undergoing, including testing its nuclear-powered engine, its ability to move its wheels, its sensor arrays and its navigation systems. The six-wheeled robotic exploration platform is readying for its scheduled July 2020 launch, which will see it sent to the Red Planet to carry on and augment the mission of the Mars Curiosity rover.
NASAMars 2020 Rover (Credit: NASA)
Curiosity launched in 2011, and landed on Mars in August of 2012. This earlier rover was designed for a two-year mission, but it got an indefinite mission extension in December 2012, and itstill operational after switching computers earlier this year following a crash — a full seven years after its original landing.
The Mars 2020 rover has received a number of upgrades versus Curiosity, which you&d probably expect, given that the team developing the newer rover has the benefit of multiple years of experience running a robotic rover platform on the surface of Mars. Mars 2020 features upgrades like improved environmental durability, and it&ll carry a host of different scientific and research equipment to complement Curiositycapabilities.
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Read more: NASA’s Mars 2020 rover rests on its own six wheels for the first time
Write comment (100 Comments)NASA and its commercial astronaut program partners are laser-focused on getting crew into space. But to get to space you first have to get to the rocket, and thatwhere the Airstream Astrovan II comes in. This vehicle, which is the sequel to the original Astrovan that brought Americaastronauts to the launch pad in the days of the Shuttle Program, features modern updates, and is heading straight from being on display at the International Astronautical Congress in Washington to Cape Canaveral to get ready for Boeingfirst CST-100 Starliner crew launch next year.
I got a chance to take a look at the Astrovan II in person, but the Airstream staff on site had cordoned off the door to the van. When I asked if I could go in, they explained it was off limits to attendees — for good reason, as this is literally the van that will be used by NASAcommercial crew astronauts during the first launches next year.
The original Astrovan had that signature Airstream &silver bullet& look, as you can see in the photo below. The updated version looks more like your standard commercial shuttle van — but what it lacks in exterior styling, it makes up for in interior creature comforts.
The outside of the Astrovan II has a full-wrap, which shows off BoeingCST-100 Starline capsule, the spacecraft that Boeing is developing for NASA as part of its commercial crew program (along with second supplier SpaceX, which is simultaneously readying its Crew Dragon capsule for service).
[gallery ids="1903180,1903175,1903174,1903176,1903177,1903178,1903179"]
The Astrovan II holds up to eight passengers (compete with flight suits) and is a custom version of the Airstream Atlas Touring Coach that was hand-built in Jackson Center, Ohio. As you can see, they opted for a minimalist, sci-fi stainless steel look on the inside, with large, comfy-looking chairs that should provide a smooth ride before the considerably rockier one the crew will experience strapped to a massive, powerful rocket en route to the International Space Station.
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Read more: Airstream’s new Astrovan II is ready to move the first Boeing commercial crew astronauts
Write comment (92 Comments)Speaking at a quick series of interviews with commercial space companies at this yearannual International Astronautical Congress, SpaceX president and COO Gwynne Shotwell shed a little more light on her companycurrent thinking with regards to the mission timelines for its forthcoming Starship spacefaring vehicle. Starship, currently in parallel development at SpaceXSouth Texas and Florida facilities, is intended to be an all-purpose successor to, and replacement for, both Falcon 9 and Falcon Heavy, with a higher payload capacity and the ability to reach the Moon and eventually Mars.
&Aspirationally, we want to get Starship to orbit within a year,& Shotwell said. &We definitely want to land it on the Moon before 2022. We want to […] stage cargo there to make sure that there are resources for the folks that ultimately land on the Moon by 2024, if things go well, so thatthe aspirational time frame.&
Thatan ambitious timeline, and as Shotwell herself repeatedly stated, these are &aspirational& timelines. In the space industry, as well as in tech, itnot uncommon for leadership to set aggressive schedules in order to drive the teams working on projects to work at the limits of whatactually possible. SpaceX CEO Elon Musk is also known for working to timelines that often don&t match up with reality, and Shotwell alluded to Muskambitious goal setting as a virtue in another part of her onstage interview at IAC.
SpaceX president and COO Gwynne Shotwell at IAC 2019 in Washington, D.C.
&Elon puts out these incredibly audacious goals and people say ‘You&re not going to do it, you&ll never get to orbit, you&ll never get a real rocket to orbit, […] you&ll never get Heavy to orbit, you&ll never get Dragon to the station, you&ll never get Dragon back, and you&ll never land a rocket,& & she said. &So, frankly, I love when people say we can&t do it, because it motivates my fantastic 6,500 employees to go do that thing.&
SpaceX has previously discussed its goal of starting its first orbital test flights of Starship within as little as a year. So far, the company has built and tested a so-called &Starhopper& demonstration vehicle, which consisted of just the base of the vehicle and one of the Raptor engines it will use for its new Starship launch system and Super Heavy booster. After completing successful low-altitude flights with that vehicle, SpaceX moved on to assembling its Mk1 and Mk2 Starship test vehicles, which represent the full scale of the ultimate orbital spacecraft, and which are being built by teams in Boca Chica and Cape Canaveral, respectively. These will perform high-altitude testing before SpaceX builds additional prototypes for orbital, and ultimately human, test flights.
SpaceX has already been contracted by Intuitive Machines and ispace, both companies working with NASA, to deliver payloads to the Moon ahead of its 2024 Artemis program human Moon landing, but these payload missions all specify using Falcon 9 to deliver their payloads.
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Facebook news section, which waspreviously reported to be imminent, is here: The company is rolling out Facebook News in a limited test in the U.S. as a home screen tab and bookmark in the main Facebook app.
In a blog post, FacebookCampbell Brown (vice president of global news partnerships) and Mona Sarantakos (product manager, news) said that news articles will continue to appear in the main News Feed. However, they said that creating a specific tab focused on journalism &gives people more control over the stories they see, and the ability to explore a wider range of their news interests, directly within the Facebook app.&
Brown and Sarantakos added that the News tab was developed in consultation with publishers, and also based on feedback from a survey of more than 100,000 Facebook users in the United States earlier this year.
It sounds like Facebook News will use both human editors and algorithms to determine which stories you see — an unusual move for a company thatbeen hesitant to police the content posted by users and advertisers. Specifically, there will be a section called TodayStories, curated by a team of journalists to highlight the biggest national news stories of the day.
At the same time, Facebook will also provide algorithmic story suggestions based on your interests and activity. You&ll be able to hide articles, topics and publishers you don&t want to see, and browse sections devoted to business, entertainment, health, science and technology, and sports — topics where Facebook users apparently felt underserved.
&Regarding personalization, publishers worry that machine learning has limits and they&re right,& Brown and Sarantakos wrote. &We have progress to make before we can rely on technology alone to provide a quality news destination.&
Nonetheless, they suggested that algorithms will be &driving the majority of Facebook News,& and that they&ll be working to ensure that those algorithms are also surfacing &new forms of journalism in the digital age, including individual, independent journalism.&
Also included: a section where users who have linked their news subscriptions to their Facebook accounts can browse content from those subscriptions.
Which publishers will be included? Brown and Sarantakos said they must be part of FacebookNews Page Index, and also abide by the companyPublisher Guidelines, which includes prohibitions against misinformation (as flagged by third-party fact checkers) and hate speech.
Facebook did not provide a list of participating publishers, but screenshots of the News section include stories from The Wall Street Journal, Time, The Washington Post, BuzzFeed News, Bloomberg, Fox Business, Business Insider, NPR and others; spokespeople for The Post, BuzzFeed and the LA Times confirmed their participation.
So even if publishers have been burned by relying too much on the social network in the past, it sounds like they&re not going to give up on working with Facebook.
It probably helps that the company is paying some of these publishers millions of dollars a year, according to Recode. (A Facebook spokesperson told me, &To ensure we&re including a range of topic areas, we&ll start by paying a subset of publishers who can provide a steady volume of fact-based and original content.&)
BuzzFeed News Editor-in-Chief Ben Smith told me via email that BuzzFeed is &glad to participate& and that &Facebook is taking the lead in recognizing the value news provides to these platforms in a tangible way.&
And Hillary Manning, the Los Angeles Times& vice president of communications, said (also via email), &We anticipate that we&ll reach new readers through Facebook News and, as we reach more readers, we expect to see more growth in our digital subscriber base.&
Facebook says News will be available to a limited group of users in the U.S., starting today.
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Read more: Facebook starts testing News, its new section for journalism
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